Krugman on Amazon

by Editor
October 20, 2014 at 9:12 am

https://www.smartertimes.com/1298/krugman-on-amazon

Paul Krugman's column is about a force in the book industry whose "power is really immense." He explains that "Book sales depend crucially on buzz and word of mouth (which is why authors are often sent on grueling book tours); you buy a book because you've heard about it, because other people are reading it, because it's a topic of conversation, because it's made the best-seller list." And he says that this force in the book industry, the one he is writing about, "possesses ... the power to kill the buzz."

The force that Professor Krugman is writing about is Amazon, and he calls for the federal government to break it up, or at least "curb its power," on antitrust grounds the way it did with Standard Oil.

But imagine if Professor Krugman's argument were applied to another "immense" power in the book industry — The New York Times itself.

Professor Krugman faults Amazon for its supposed "selectivity." He writes:

Specifically, the penalty Amazon is imposing on Hachette books is bad in itself, but there's also a curious selectivity in the way that penalty has been applied. Last month the Times's Bits blog documented the case of two Hachette books receiving very different treatment. One is Daniel Schulman's "Sons of Wichita," a profile of the Koch brothers; the other is "The Way Forward," by Paul Ryan, who was Mitt Romney's running mate and is chairman of the House Budget Committee. Both are listed as eligible for Amazon Prime, and for Mr. Ryan's book Amazon offers the usual free two-day delivery. What about "Sons of Wichita"? As of Sunday, it "usually ships in 2 to 3 weeks." Uh-huh.

Which brings us back to the key question. Don't tell me that Amazon is giving consumers what they want, or that it has earned its position. What matters is whether it has too much power, and is abusing that power. Well, it does, and it is.

Well, to begin with, this distorts the reality. Here's an account from a Times news article:

The day after publication of "The Way Forward," the host of CNBC's "Squawk Box," Andrew Ross Sorkin, told Mr. Ryan, "Very hard to buy your book, by the way, right now on Amazon."

"I know," a clearly frustrated Mr. Ryan answered. "Because that is what Amazon is doing with Hachette."

A person close to Mr. Ryan, the 2012 Republican vice presidential candidate, said later that, "For a while, all you could see on Amazon was the audiobook."

Mr. Berman directly challenged any suggestion that the book was impossible to buy. "Mr. Ryan's book was available for purchase in print and digital formats at its publication date," the spokesman wrote in an email. He declined to elaborate.

But second of all, consider how the New York Times itself, a powerful force in creating buzz in the book industry, has treated the two books. The attack on the Koch brothers, by Mr. Schulman, got a full-length Sunday review by Nicholas Lemann, was featured in the Times Book Review podcast, and was mentioned yet again in the Sunday Book Review as an "Editors' Choice." As for Mr. Ryan's book, its treatment in the Times has primarily come in articles about Amazon.com. When it showed up at no. 5 on the Times bestseller list, the book review deigned to mention it in a two paragraph item that denounced the book as being "full of your basic agitprop" and inaccurately described it as Mr. Ryan's "first book," a distinction that in fact belongs to the 2010 book Young Guns, which the Times itself handled back in 2010 with a four-sentence review that managed to be about 100 percent wrong.

By Professor Krugman's standard that a powerful book industry force treating two different books differently is cause for the government to step in, the Times columnist ought to be calling for the Justice Department to rush into Times Square and take dramatic action. It's enough to make a cynic suspect that the Times panic over Amazon isn't about its market power or disparate treatment at all, but the fact that Amazon's CEO owns the Washington Post, a newspaper that competes with the New York Times. Or about the fact that the Amazon CEO, Jeff Bezos reportedly has libertarian-oriented politics rather than Professor Krugman's statist views.

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